Statutory conversion
In accounting, statutory conversion means changing an entity's legal form under a state conversion statute — an LLC becoming a Delaware corporation under 8 Del. C. §265 — so the converted corporation is the same entity and nothing is wound up. For tax, a partnership's conversion is treated as a transfer of its assets to the corporation for stock, followed by a distribution of the stock to the partners.
Authority: 8 Del. C. §265 (opens in a new tab). Sources
The lesson that teaches this
From the free founder back-office course, taught on one company's books, with exercises to work it yourself.
What it is not called
Each of these means something else. Use one here and an accountant reading the product notices.
- reincorporation (changing the state)
- merger
Also in Entity types
Defined in Lexicon. This page is generated from that document, so the two can't disagree.